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Retire and then go back question

Discussion in 'Retirement' started by tonyuk, May 12, 2019.

  1. tonyuk

    tonyuk Occasional commenter

    I hope someone can help.
    It is a few years off but I want to have a plan.
    If I retire for a day and then go back to work how much am I allowed to earn and does this include pension. I am trying to figure if I would be better going supply and can have flexibility or if I can work at same place but drop responsibility etc (depending on how much I can earn).

    Thanks for any help
  2. 50sman

    50sman Lead commenter

    If it is before the age of 60 you can earn s mich as you want!

    You mention a few years off which means a fair amount of your pension is in the new average scheme

    Please ring TP for definitive explanation and figures
  3. tonyuk

    tonyuk Occasional commenter

    No it will be 60 I will ring but I wondered if anyone on here knew
  4. 50sman

    50sman Lead commenter

    Everyone is different
    As I said if you take arb before the age of 60 there is no limit on earnings.

    However it could be you can only take arb on the Part of your salary that is in the old scheme.

    You also need to work out how much money you need - in a way that is the more important question
  5. diddydave

    diddydave Established commenter

    Before 60 you can claim your pension benefits but if you are continuing with the same contract you need to get your employers consent - but doesn't sound as though you are planning on carrying on with the same contract: https://www.teacherspensions.co.uk/employers/member-retirement/early.aspx

    Before 60 you take reduced benefits but there are no restrictions on what you can earn. Only if you take the benefits at 60 is there any restriction.
  6. tonyuk

    tonyuk Occasional commenter

    On to try to clarify I can take my lump sum etc at 60 and then retire for a day and possibly to back.
    How much can I earn with my old employer compared to current salary? I am not planning on going before 60 and reducing my pension!
  7. diddydave

    diddydave Established commenter

    richest1 likes this.
  8. diddydave

    diddydave Established commenter

    Trying to put some figures on this for you (Note I am not an expert and you'll need to check these with one, TPS or both!)

    Assuming the following:
    1) you are totally in the final pension scheme
    2) your salary of reference (the one used to calculate benefits) is about £40,000
    3) you have 40 years of service (just because it makes the maths easy)

    If you retire at 60 you get a pension of 40/80ths of £40,000 which is £20,000.
    So you can earn another £20,000 as this takes you back up to the salary of reference figure.

    If you retire at 59 and 11 months you get 99.8% of your pension, £19,918.42 but you can then earn any amount from teaching.
    Working out shown: ((39 + 11/12) * £20,000 * 99.8%) i.e. 1 month less service and 0.2% less.

    Note: The restriction only applies to jobs that can be part of the TPS, you could go and work for Tesco* and earn any amount even if you have waited until 60 to take the teacher pension.

    *Other employers are also available.
  9. diddydave

    diddydave Established commenter

    That was my 'gut' instinct too but it's worth knowing the actual numbers...so...
    Based on my last post you would 'lose' £81.58 a year...BUT...you get paid for 1 more month in that first year, 'a gain' of £1659.87.
    You 'lose' 3 x £81.58 from the lump sum.

    So at the end of the first year, if you went 1 month early you are ahead by £1,415.13 but on £81.58 less each year from then on. Dividing them will give you the number of years it takes to catch up:
    1415.13 / 81.58 = 17.33 years.

    So when you reach 77 1/3 you will, from that point on, be £81.58 a year 'better off'.
    wayside34 and eljefeb90 like this.
  10. tonyuk

    tonyuk Occasional commenter

    Brilliant thank you for the answers diddydave many thanks I now know that I need to retire before I hit 60 and then I can continue on.
  11. diddydave

    diddydave Established commenter

    The only other, possibly, tricky part is when you turn 59 11/12ths...to take the pension early you have to have left teaching...now this can be for the single day but obviously you will need the agreement of your employer and get a new contract for any time after that...

  12. tonyuk

    tonyuk Occasional commenter

    diddydave I hope I can negotiate that closer to the point of retirement if not the I will go to 60 retire and do supply etc but as there are a lack of teachers it is to their benefit to take me back on with no loss of hours etc and I end up getting a pension on top of salary (If I read your reply correctly)
  13. diddydave

    diddydave Established commenter

    The problem at 60 is that if you are earning close to your salary of reference then your pension can easily take you over it.

    Suppose your salary of reference is £45k and your current salary is £40k if you take a pension AND keep working at £40k you will go over the limit if your pension is more than £5k
  14. tonyuk

    tonyuk Occasional commenter

    I thought that if I retired just before 60 then I could earn anything?
  15. FrankWolley

    FrankWolley Star commenter

    OP, are you sure that your retirement date is 60? I thought it had gone up for all those currently under that age...

    FWIW I too understand that if you retire and take a reduced pension (even marginally reduced), you can (after a day's break in service) earn as much as you wish. So why not retire before the retirement age (maybe one month before)?

    If you are unsure, I'd speak to the TPS and possibly your Union.
  16. diddydave

    diddydave Established commenter

    You can BUT you need your employer's consent and a break in contract. (or to have stopped working)
    The timing can be critical.

    Sorry but your last post said you'd go til 60 so I thought you were back on taking it to 60 and not going before.
  17. diddydave

    diddydave Established commenter

  18. tonyuk

    tonyuk Occasional commenter

    I did enter before 2007 and thus can go at 60 however I had a break in service so I also have another pension at 67 - I am happy to reduce the 67 one down but I have no idea how this part works so that is one for TPS.
    I will be going before 60 in which case so that I can continue with current salary plus pension.
    Thanks to everyone who has advised.
  19. diddydave

    diddydave Established commenter

    The 67 one is where they work out your pension by 'adding' 1/57th of your earnings each year to it. This figure is increased each year by inflation (and an extra 1.6% if you stay in the scheme).

    If you go at 60 you can leave this one to grow until you are 67 and then take it, but if you take your other one before 60 you HAVE to also take it as well...and the reduction is higher as it is taken 7 years early.
  20. tonyuk

    tonyuk Occasional commenter

    Oh in that case I definitely need to do some severe calculations

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